Optimizing Chat Sales and Support For Online Travel

The online travel market continues to grow. Experts estimate the shift from storefront to online travel agencies is nearly complete, with 53% of all travel booked online. Priceline leads the charge as the most profitable travel agency, with a forecast earnings estimate of $85.92 in 2018. Digital travel sales have been steadily increasing in the recent years. A report by Statista estimates the value of the industry to increase from $593 billion in 2016 to $762 billion in 2019. The large majority of that market is U.S. and European customers, with customer growth in Asia-Pacific, Latin America and the Middle East increasing with internet penetration. Although growth rates are slowing for online travel, optimizing chat sales and support for Online Travel Agencies (OTA’s) in order to increase customer retention and satisfaction should be a top priority.

Ancillary Revenue Is Up

CarTrawler and IdeaWorksCompany, the top consultancies for online travel, estimate airline ancillary revenue to be $67.4 billion in 2016. That’s a huge number. With global travel revenue approaching the $800 billion mark, ancillary revenue accounts for roughly 10%. So what is ancillary revenue? It’s the add-ons associated with travel purchases that are ancillary to your trip from point A to point B. The most common example is checked or extra luggage, but ancillary revenue runs the gamut from promotional hotel bookings to in-flight WiFi. Increasing ancillary revenue often means increasing customer engagement--and brand loyalty--so customers are more receptive to suggested ancillary purchases.

Mobile Purchases On The Rise

Running parallel to the rise of mobile devices in e-commerce - especially by millennials - Online Travel Agency mobile purchases are looking up. According to a report by Criteo, Airline and hotel mobile bookings made up 27 percent of all online travel bookings worldwide during the second quarter of 2016. If the online travel industry is valued at a whopping 600 billion dollars, that means mobile travel booking is a 15 billion dollar industry. To capitalize on this trend, OTA’s are keeping up with mobile marketing strategies including push notifications, email marketing, and customer engagement. A report by Urban Airship shows a positive notification engagement rate in the travel & tourism industry of roughly 30%, compared to the 15% average across all industries. This means that a significant number of mobile users respond to proactive engagement from travel agencies, such as push notifications with sale alerts and email reminders to purchase extras like trip protection, in-flight meals and hotel bookings.

Live Chat Increases Customer Engagement

If we synthesize what we know about consumer behavior in the online travel industry, it’s a safe bet that capitalizing on mobile use cases with a focus on ancillary sales is a great strategy for CMOs to boost revenue. In traditional stores, customer engagement requires a salesperson having an in-store 1:1 conversation with one customer at a time, proactively offering assistance and/or attempting to sell them additional products. In online sales, live chat is the best - and only - way to add an emotionally intelligent human dimension to the customer's purchase experience. Furthermore, live chat features in OTA mobile apps present an opportunity for optimizing chat sales tactics based on consumer behavior in order to increase conversion.

Priceline, the current leader of the Online Travel Agencies, boasts a convenient live chat feature that its competitors lack. By a simple click of a prominent icon that reads ‘Chat with us’, Priceline’s customers can communicate with a live agent regarding optimal trip times, opportunities for savings, flight add-ons, and more. Priceline’s stock is soaring even as travel gets more competitive, with a 24% increase in bookings in the first quarter and 27% room night growth. As is the case in other e-commerce sectors, customer engagement is key. Efficient and intelligent assistance through the entire purchase process increases brand loyalty, retention and produces significantly more positive recommendations on social websites and personal referrals. Happy, engaged customers refer friends. Chief Marketing Officer's benefit from the free, positive publicity and increased conversion rate provided by optimizing chat sales. The best way to promote customer engagement is to optimize 1:1 customer-to-company communications by introducing a human element to your website, travel portal, or mobile app.

About Tony Medrano

Tony started his career as a technology entrepreneur out of his Stanford University dorm as co-founder and President of DoDots, the first desktop-to-mobile app platform. He built the company to 100+ employees, raised $25M in venture capital and managed all company operations, personnel and deals.
He was most recently CEO of Boopsie, a mobile Platform-as-a-Service company that he grew for 4 years and successfully sold to a strategic partner in 2015. Tony has also served as Vice President of Sales / Business Development at Reply! and SmartDrive Systems.
Tony has dedicated his career in technology to leading sales teams and understands the need for automation tools that help sales reps increase efficiency, close more business and increase margins.
Tony received his MBA and JD from Stanford, M.A. from Columbia and B.A. from Harvard.